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FADA accuses Harley-Davidson of not intimating sellers of India plans
The Federation of Automobile Dealers Association (FADA) has stated that no info was offered to Harley-Davidson dealerships in India in regards to the American model’s resolution to wind up gross sales and manufacturing operations in India. On Thursday, Harley-Davidson introduced that it has determined to discontinue its gross sales and manufacturing operations in India, which “will include an associated workforce reduction of approximately 70 employees.” The resolution is a part of the American bike model’s restructuring actions that it refers to as ‘The Rewire’.
Also Read: Harley-Davidson Decides To Wind Up India Operations
Harley-Davidson USA as a part of its United States Securities and Exchange Commission Form 8-Ok submitting introduced on Thursday that the restructuring choices beneath ‘The Rewire’ technique consists of “optimising its global dealer network, exiting certain international markets, and discontinuing its sales and manufacturing operations in India.” Apparently, the information got here as a shock, not simply to Harley-Davidson India staff, but additionally to Harley-Davidson’s 33 dealerships throughout India. FADA President Vinkesh Gulati has stated that no info was given to Harley-Davidson sellers in India who had invested within the model. FADA, an apex nationwide physique representing car retail in India, contends {that a} Franchise Protection Act would have helped the pursuits of the Harley dealerships throughout India.
Also Read: Harley-Davidson Reports $92 Million Loss As Bike Sales Skid
Harley Davidson filed in USA Securities closure of India Operations.
No info to Dealers or prospects who invested. @narendramodi Franchise Protection Act would have protected us from such exits-GM : MAN Trucks and UM Lohia #FranshiseProtectionAct@ashwani_mahajan pic.twitter.com/N6l0KjBiLu
— Vinkesh Gulati (@VinkeshGulati) September 24, 2020
“Harley Davidson, the company has not informed any of its Dealer Partners about its closure plans and dealers are yet to receive any official communication. It goes without saying that dealers who have invested their hard earned capital in this iconic brand are left like an abandoned baby without any compensation package. Had there been a Franchise Protection Act in India, brands like these would not have abruptly closed their operations leaving their channel partners and customers in a fix,” stated Gulati.
“With each model closing its store in India, India’s capital circulation goes down the drain. With a luxurious model like Harley, organising its dealership prices anyplace between ₹ 3-four crore and with a complete of 35 dealerships, Rs 110-130 crore will go down the drain. Moreover, there can be prospects who won’t obtain glitch free service as spares will now be in scarcity thus resulting in instances and harassment’s to sellers from their prospects.
“Each luxury two-wheeler dealership on an average employs 50 people. With 35 Harley dealers, around 1800- 2000 people at dealerships will lose their jobs. After General Motors, MAN Trucks and UM Lohia, Harley Davidson is the 4th Automobile Brand which is shutting shop in last 3 years in India,” Gulati added.
Also Read: Harley-Davidson To Rethink Product Strategy; Future Models May Be Shelved
carandbike reached out to a number of Harley-Davidson seller principals, however none had been keen to react to the event on the report but. A supply in a dealership advised carandbike that the contract will expire on December 31, 2020, however that Harley-Davidson dealerships will proceed to promote present inventory and supply service and after gross sales assist to prospects. Dealers are placing up a courageous face; the understanding is that solely manufacturing has been closed, the story of the model is much from over.
Also Read: Harley-Davidson Looking For An Alliance With Indian Two-Wheeler Companies
Also Read: Harley-Davidson To Close Deal With Hero MotoCorp
Harley-Davidson India has but to answer a question from carandbike, however Form 8-Ok submitting is a authorized process to announce main occasions that shareholders ought to learn about. And beneath the principles of submitting, Harley-Davidson couldn’t have intimidated anybody earlier than submitting. So, solely after it was filed, had been Harley-Davidson India staff and dealerships knowledgeable of the announcement. On its half, Harley-Davidson India launched a press assertion after the announcement, saying that as a part of The Rewire, Harley-Davidson has introduced “an overhaul of its operating model and market structure” and that “the company is changing its business model in India and evaluating options to continue to serve its customers.”
Also Read: Hero MotoCorp Open To A Partnership With Harley-Davidson
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However, it is nonetheless not clear if discontinuing manufacturing operations and gross sales means the top of the Harley-Davidson model in India. In reality, the model could not fully wind up operations in India, as has been perceived. As a part of the brand new “business model”, one possibility could be to usher in Harley-Davidson bikes from its manufacturing facility in Thailand and provide them in India by way of the identical dealership community. India and Thailand have a Free Trade Agreement (FTA) and even Ducati and Triumph comply with the identical route, with duties figuring out to be way more aggressive and the value benefit then handed on to the patron. The different possibility is to alter the working mannequin with a neighborhood companion, one thing like how Benelli operates and even MV Agusta used to comply with. And from all indications, it might effectively be the second possibility that can give Harley-Davidson a second shot on the world’s largest bike market, that of becoming a member of fingers with a neighborhood two-wheeler large.
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